The general objectives of this project are to examine the impact of Federal policy changes and healthcare market forces on the organizational and management strategies, financial viability and clinical performance of U.S. rural hospitals. The specific aims of the study are to: 1) Assess the impact of recent Federal legislative changes, including the phased implementation of the Balanced Budget Act of 1997 (BBA), the Balanced Budget Refinement Act of 1999 (BBRA), and the Benefits Improvement and Protection Act of 2000 (BIPA) on the organizational status, management strategies and financial performance of rural hospitals of various types; 2) Examine the effects of healthcare market forces, particularly increases in managed care pressures, on the organizational status (closure, merger and conversion), management strategies and financial performance of rural hospitals; 3) Analyze the extent to which early hospital adoption of managed care arrangements, system affiliations and other types of strategies influences subsequent rural hospital strategic behavior and financial performance; and 4) For a subset of rural hospitals in selected States, explore relationships over time among legislative changes (BBA/BBRA/BIPA), market forces, financial status, organizational characteristics and clinical performance. The analysis will be based primarily on a panel study consisting of a national stratified, random sample of approximately 800 rural hospitals first surveyed through telephone interviews with hospital Chief Executive Officers during the late 1980s. These hospitals will be resurveyed during 2003-04. Financial performance will be examined using data from the Health Care Financing Administration Medicare Cost Reports. The clinical performance of a subset of these rural hospitals will be assessed using data from accreditation surveys as well as selected indicators of potentially avoidable adverse hospital outcomes, employing a methodology developed by the Healthcare Cost and Utilization Project (HCUP) and the Complications Screening Program. In order to help inform current policy debates, the dissemination of study results will be aided by project consultants representing the Rural Policy Research Institute (RUPRI). The RUPRI panel members work directly with Congressional and Administration policy makers in efforts to ameliorate unintended consequences of the BBA, BBRA, and other recent Federal policy changes.